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The Blockowicz plaintiffs were the object of posts accusing them of a variety of heinous acts. The posts were made by a former family member on a number of sites, including Facebook and MySpace and a second complaint site in addition to the Ripoff Report site operated by Xcentric. They brought suit and obtained a default judgment, including a permanent injunction requiring the defendants to remove the posts, which  the defendants failed to do. The injunction also included a provision allowing the plaintiffs' counsel to contact Web site hosts, "who shall make reasonable efforts to ensure the false statements are removed." While the other hosts removed the postings, Xcentric refused to do so, and in response to a motion for enforcement of the judgment, argued that the court lacked authority under Fed. R. Civ. P. 65 to compel them to comply.

The district court agreed with Xcentric, citing CDA Section 230 only in passing. Noting that the case was one of first impression, the court addressed the requirement in Fed. R. Civ. P. 65(d) that enforcement of an injunction against a non-party requires a showing that the non-party was "acting in concert or legally identified (i.e., acting in the capacity of an agent, employee, officer, etc.) with the enjoined party." The court rejected the argument of the Blockowicz plaintiffs that Xcentric was in "active concert or participation" with the defendants because they entered into an agreement with the defendants when they posted on the Ripoff Report site. The plaintiffs pointed to the statement in the site's Terms of Service that posted material will not be removed, even upon the request of the poster, and that the Xcentric was granted an irrevocable, perpetual, fully-paid, worldwide exclusive license to the posted material, and argued that these provisions "are essentially a promise to aid and abet the Defendants in continuing defamation regardless of any court orders."

The court focused instead on the language in the terms of service requiring users to post "truthful and accurate statements." According to the court, the record in the case "is devoid of any evidence that Xcentric intends to protect defamers and aid them in circumventing court orders." Although that is the result of the court's ruling, as the court itself recognized:

The court is sympathetic to the Blockowiczs’ plight; they find themselves the subject of defamatory attacks on the internet yet seemingly have no recourse to have those statements removed from the public view. Nevertheless, Congress has narrowly defined the boundaries for courts to enjoin third parties, and the court does not find that Xcentric falls within those limited conscriptions based on the facts presented here.

It should be noted that the Ripoff Report sites bills itself as being "by consumers, for consumers," and its founder, Ed Magedson, describes himself as a "consumer advocate." Although Xcentric will not remove allegedly defamatory material, it will, for a fee, provide remedial assistance to companies that are the subject of defamatory reports through its "Corporate Advocacy Program." The site and its program have been challenged, unsuccessfuly so far, on the theory that they constitute an extortion scheme. The particular posts involved in this case did not involve a consumer transaction, however, but resulted from a dispute amongst former family members, as described more fully in this post on the Ars Technica site.

In addition to the Arts Technica post, Prof. Eric Goldman has commented on the case and  expressed concern at the result, as has Ben Sheffner of the Copyrights and Campaigns blog.

Although the court noted that the issue is one of first impression, a similar case, also involving a post on the Ripoff Report site, was concerned with Xcentric's refusal to remove user posted content. In Global Royalties, Ltd. v. Xcentric Ventures, 2008 WL 565102 (D. Ariz. Feb. 28, 2008) a district court held that even though the original author of a "report" on Xcentric's site asked for it to be removed and Xcentric refused, Xcentric was not liable for allegedly defamatory statements in the report, citing CDA Section 230.

 

Yahoo moved to dismiss Barnes's remaining claim on the ground that she had failed to allege sufficient facts from which the court could reasonably infer a valid claim of promissory estoppel. Under Oregon law, the court noted, such a claim requires: “1) a promise; 2) which the promisor could reasonably foresee inducing the sort of conduct which occurred; 3) actual reliance on the promise; 4) resulting in a substantial change in the promisee's position.” Yahoo! argued that Barnes failed to show reliance or a substantial change in her position as a result of the alleged promise.

To resolve the motion, the court delved into the factual specifics of Barnes's claim that a Yahoo! employee made an actionable promise. According to Barnes, she attempted unsuccessfully over a period of three months to have the defamatory profiles removed from the Yahoo! site, but when a reporter contacted Yahoo! in preparation for a news story about Barnes's situation, a Yahoo! employee contacted Barnes, and allegedly promised her that she would personally contact the appropriate personnel and “take care of” having the profiles removed. Barnes then called the reporter, essentially calling off the story on the ground that the profiles would be removed. The profiles were not in fact removed, however, until some time later when Barnes filed her action.

As to Barnes's “reliance” on Yahoo!'s alleged promise, the court concluded that “it is reasonable to conclude” that the Yahoo! employee's call to Barnes was for the purpose of heading off the news story before it aired, and that it could be inferred that the employee intended for Barnes to react to the promise by calling the reporter and squelching the story. Thus, the court reasoned, there is a “reasonable and plausible” inference that Barnes relied on the employee's promise.

As to the element of “substantial change” in Barnes's position, while the court regarded the sufficiency of the facts as a closer question, the court concluded that there were sufficient facts from which inferences could be drawn that supported Barnes's theory:

As stated above, however, a reasonable inference from plaintiff's amended complaint is that defendant was concerned about the potential for negative attention from a television news story focusing on defendant's indifference to plaintiff's plight. A further reasonable inference is that defendant was focused on removing the unauthorized profiles solely in relation to diffusing the potential news story. After plaintiff's phone call to the reporter, defendant realized the story was not going to air – or that it would portray defendant in a better light – and thus plaintiff's profiles no longer presented a pressing issue requiring defendant's immediate attention. Indeed, the amended complaint specifically alleges that defendant only removed the profiles after plaintiff filed this action.

Thus, the court concluded, Barnes's position “could have substantially changed in that the profiles remained on the web longer than they would have absent plaintiff's reliance.”

It remains to be seen, of course, whether Barnes will be able to prove the facts as alleged. It does not appear from a review of the docket that a trial date has been set.

Although the Barnes v. Yahoo! case is significant for the fact that the plaintiff was able to define a claim that survived Section 230 immunity, it is difficult to view it as other than peculiar to its unique facts, which seem unlikely to recur in future cases. In particular, in rejecting the motion to dismiss, the court relied heavily on the possibility of a news story concerning the plaintiff as the basis for finding that the element of reliance was factually supported.

Nevertheless, Web site operators would be wise to educate their employees regarding the proper handling of requests to remove allegedly defamatory content, in order to avoid generating a claim that might survive the summary judgment stage of litigation.

The plaintiff alleged that her boyfriend posted "incedent" profiles of her on Yahoo! that included nude photographs taken without her knowledge and solicitations for sex. He also posed as the plaintiff in Yahoo chat rooms. The profiles on Yahoo! included real contact information, resulting in unwanted communications to the plaintiff from men seeking sex. The plaintiff alleged that she followed Yahoo's policy in requesting the removal of the information, but after promising to remove the profiles Yahoo took no action for several months.
 
The plaintiff sued under Oregon law for negligent provisions of services and negligent undertaking. The appeals court also concluded that, to the extent that the plaintiff claimed that she relied on Yahoo's promise to remove the profiles, she stated a breach of contract claim based upon promissory estoppel. Yahoo! prevailed on a motion to dismiss in the district court, which found that Section 230 protected Yahoo! as a matter of law.
 
The Ninth Circuit panel held that Section 230 bars the plaintiff's negligent provisions of services / negligent undertaking claim, but remanded for further consideration of the promissory estoppel claim, because promising to remove content (as opposed to merely failing to remove it) is not necessarily the act of a publisher:

Promising is different because it is not synonymous with the performance of the action promised. That is, whereas one cannot undertake to do something without simultaneously doing it, one can, and often does, promise to do something without actually doing it at the same time. Contract liability here would come not from Yahoo’s publishing conduct, but from Yahoo’s manifest intention to be legally obligated to do something, which happens to be removal of material from publication. Contract law treats the outwardly manifested intention to create an expectation on the part of another as a legally significant event. That event generates a legal duty distinct from the conduct at hand, be it the conduct of a publisher, of a doctor, or of an overzealous uncle. The case was remanded for further consideration of the plaintiff's contract claim.

The case was remanded for further proceedings on the plaintiff's contract claim. Note that the lower court also did not consider whether the plaintiff's cause of action was precluded under CDA Section 230 (c)(2), so that issue remains for consideration on remand.

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UPDATE: In its amended opinion issued June 22, 2009, the Ninth Circuit addressed two issues that were raised by Yahoo! in its petition for a rehearing and rehearing en banc. The court withdrew Part II of the opinion which stated that Section 230 claims should be raised as an affirmative defense in an answer rather than on a pre-answer motion to dismiss. The court also clarified a footnote that had suggested that CDA Section 230 applies only to state law claims. The importance of these issues is discussed by Prof. Eric Goldman on his blog.

In Ecommerce Innovations, L.L.C. v. Does 1-10, No. MC-08-93 (D. Ariz. Feb. 10, 2009) a judge that previously issued an order compelling compliance with the third-party subpoena to Xcentric has refused to reconsider that ruling, finding that the plaintiff had made out a prima facie case of defamation against the anonymous posters and thus was entitled to the identifying information from Xcentric. The court cited e.g., Best Western International v. Doe, 2006 WL 1091695 (D. Ariz. July 25, 2006) and Mobilisa, Inc. v. Doe, 170 P.3d 712 (Ariz. Ct. App. 2007). However, the court also concluded that there were "serious questions" concerning the standard to be applied in discovering the identities of anonymous Internet posters, and whether the evidence in the case meets that standard. Consequently, the court stayed its order compelling compliance in order to allow Xcentric to appeal to the Ninth Circuit.

It will be interesting to see if the Ninth Circuit chooses to take the appeal, and whether, if it does, Judge Kozinski is on the panel. That's a bit of a long shot, considering the number of judges in the Ninth Circuit. But it would certainly heighten interest in the case, at least for followers of CDA Section 230 jurisprudence. Judge Kozinski authored the panel opinion (now superseded by the en banc ruling) in Fair Housing Council v. Roommate.com. Judge Kozinski's panel opinion posed a scenario in which allegations of egregious conduct on the part of a service provider might not fall within the protection of CDA Section 230 immunity. Some have speculated that Judge Kozinski's hypothetical referred to the Ripoff Report site, although the court in yet another Ripoff Report-favorable CDA Section 230 ruling rejected the comparison. See Whitney Information Network, Inc. v. Xcentric Ventures, (M.D. Fla. Feb. 15, 2008).

But of course the more important fact is that if the appeal is filed and then allowed, the Ninth Circuit will have the opportunity to rule on the standard to be applied in cases involving discovery request directed at obtaining the identity of anonymous posters.

Update: The appeal was dismissed by stipulation of the parties in September 2009. The stipulation includes the following statement:

7. Ecommerce Innovations no longer wishes to compel compliance with
the subpoena or to demand the identity of the anonymous publisher from Xcentric
Ventures, LLC, and the parties have settled the action on terms that include a
dismissal of the underlying miscellaneous proceeding.
8. The parties have agreed that dismissal of the underlying proceedings
renders this appeal moot.
Accordingly, the parties agree to dismiss the instant appeal.
DATED: September 14, 2009 BUCHALTER NEMER
A Professional Corporation
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